Slaughters questioned by MPs over decision to omit partners from gender pay gap reporting

Slaughter and May has been questioned by MPs over its decision not to publish details of its  gender pay gap at partner level and the struggles law firms face to improve female representation among their senior ranks.

The magic circle firm’s HR director, Louise Meikle (pictured), appeared before the Business, Energy and Industrial Strategy Committee this morning (28 March) as part of its inquiry into private sector pay, corporate governance and the actions organisations are taking to address the gender pay gap.

She was asked by committee chair Rachel Reeves MP why her firm had taken the decision to not include partners in its gender pay gap reporting, when other magic circle firms had done so, despite it not being a statutory requirement.

Meikle told the committee that the firm would welcome specific guidance on how to publish partner gender pay data, citing the difficulties presented by inconsistencies in the way partners are remunerated at different law firms.

She added: “We would be happy to publish if we had clear guidance on how to do that in a meaningful way; if we had agreement on how to collate the data and make it comparable across organisations. We are not trying to hide the stats about the gender balance at the top.”

While some law firms, including magic circle rivals Linklaters and Clifford Chance, included partners in their pay gap reporting, Slaughters did not, although it did voluntarily reveal that its female associates are paid on average 2.1% more than men, with average bonus pay for women 2.7% higher than male associates.

However, when looking at all non-partner employees, the firm has a 14.3% mean pay gap in favour of men, with a 38.5% gap when using the median average.

Unlike most other major UK law firms, Slaughters does not publicly disclose its profit per equity partner figures, which Meikle explained to the committee, adding that the firm’s pure lockstep structure has no gender bias.

“We have a very simple approach to partner renumeration – two factors: profit and length of time as a partner,” she told the committee. ”There was a sense that for us it was not going to show us anything new and without that clarity about how to make meaningful use of it, we decided not to.”

However, this approach was questioned by Reeves, who said that people listening to Meikle’s answers would ”hear very clearly” what the firm’s attitudes to transparency and the gender pay gap reporting requirements were.

Reeves suggested that if she was a young woman, she would “think twice” about working at Slaughters, to which Meikle responded that the firm was “not being any less transparent than anyone else”.

Peter Kyle MP also quizzed Meikle on why, when more than half of university law graduates are female, law firms have an issue with the number of women making partner. She responded by highlighting that half of Slaughters’ trainees are female, while acknowledging the challenge to translate that through to partnership level.

Meikle added: “We have to change the proportion of people coming into the partnership significantly and quickly. We should be aiming to get to 50% admissions of female partners in the next few years. We know what we need to do.

“In a partnership, people stay a partner for a long time. If you are looking at reaching 30% female partnership, we could potentially achieve that over the next five years. Those are the sort of periods of time you are talking about given the structural challenges of a law firm.”

Other panel witnesses included Laura Hinton, chief people officer at PwC, which originally chose not to disclose its partner pay gap, before later restating its figures with partners included.

Hinton said: “With hindsight, we should have published partners at the time, it is the right thing to do if you believe transparency drives action. Our women are absolutely as ambitious as our men – they want to come through to partnership level. There are assumptions made about what it is like to be a partner and we need to address that.”

Including partners, PwC reported a mean gender pay gap of of 43.8% and a median gap of 18.7%.

Slaughter and May declined to comment.